Many of LinkedIn’s more than 300 million users keep their profiles updated to maximize networking, which might come in very handy when looking for new jobs.
However, a few of the site’s users allege in a new lawsuit that LinkedIn ruined their chances of getting certain jobs because of something called “Reference Search,” a product that is available for the site’s premium members.
The proposed class-action lawsuit was filed last month in California. The suit claims that “Reference Search” violates the Fair Credit Reporting Act (FCRA), a 1970 law created to protect people from being unfairly denied a mortgage, credit, or employment based on a background check or credit report.
Reference Search is meant to give hiring managers a list of people whose LinkedIn profiles indicate they have worked with a person the hiring company is considering for a position. Hiring companies can then use LinkedIn’s “InMail” to contact the people on the list and get their opinion of the job candidate.
The lawsuit points out that this feature puts job hunters at a disadvantage by creating opportunities for past co-workers to provide negative reviews of their former colleagues — without the job candidate having a chance to agree to such a reference.
“Indeed, LinkedIn regularly assembles information on consumers into Reference Reports that it provides to third parties in interstate commerce, including companies in the human resources and recruiting industries, for monetary fees or dues,” reads the lawsuit. “LinkedIn is in the business of furnishing consumer reports to third parties that are used or expected to be used for employment purposes.”
By providing these “consumer reports”, LinkedIn falls under the authority of FCRA, which requires notifying “consumers who are the subject of an adverse action (e.g., denial of employment) based in whole or in part on information contained in the consumer report.”
The suit alleges that former co-workers listed in a Reference Report may not have even worked closely with the job candidate, or could be otherwise unqualified to discuss the candidate’s abilities.
The suit claims that one of the lead plaintiffs was told by a hospitality company that it had decided to hire her for a job she had applied for on LinkedIn. But soon afterward, the company allegedly told the plaintiff it had changed its mind. The company allegedly reversed its decision based on references collected on LinkedIn, and not known to the plaintiff.
LinkedIn spokesman Joe Roualdes told Business Insider that the company planned to fight the lawsuit, adding that Reference Search merely organizes information that its users have already decided to make public.